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            november 22, 2019

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Global Institute of Logistics to audit Indian container terminals


New York's Global Institute of Logistics, in a tie-up with Chennai's Hauer Associates, is planning to introduce certification system for container terminals in India, in which performance would be audited and classified, reports India's Economic Times.
Global Institute CEO Kieran Ring said the move to certify terminals is part of the plan to improve logistics. Called the Container Terminal Quality System (CTQS), the method assesses container terminals across 80 indicators from crane productivity to staff training, granting full certification after auditing.
Said Hauer Associates chief executive SN Srikanth: "The mechanism will help Indian ports sell themselves. It won't be too long when we will have excess capacity."
The Port of Hamburg has been certified under the system, devised by the Global Institute of Logistics "combined with terminal operators such as PSA and Shenzhen-Yantian as also industry bodies such as IAPH and Global Shippers Forum", said the report.
According to a World Shipping Council list, in 2010, six of the top 10 busiest terminals in the world were in China, with Shanghai heading the list. India had one, Mumbai's Nhava Sheva, in 26th place.
"But when it comes to efficiency, comparisons are tougher," said the report, noting that the Ministry of Shipping said Indian ports lag behind Singapore in key terminal parameters with crane productivity of 20 moves per hour against Singapore's 30 while turnarounds are 1.77 days for India and 0.50 days for Singapore.
K Ravichandran, co-head of corporate ratings at Icra (formerly Investment Information and Credit Rating Agency, today associated with Moody's), said: "A standard format would definitely help. This will help business process re-engineering of ports in relation to the benchmark."
Michael Pinto, former government shipping secretary, pointed out how TEU isn't an adequate measure. "For example, a port might be more efficient, but gets lower TEUs because of its location. The terminals should be measured based on the number of containers handled per house, turnaround times, efficiency of crane handling and so on."
A senior unidentified Singapore-based logistics company official said: "Terminals account for 95 per cent of the cost of a logistics operation, and inefficiencies in terminals have an indirect impact on our profitability. As a director I should be focusing more on business development. But due to inefficiencies in major ports, most of my time is spent on terminals."
But Mumbai's JNPT operations chief SN Maharana disagreed. "We already have been given specific parameters on which we have to function and we monitor all the performance."
Agreeing, rival Mundra port director Rajiv Sinha said: "Every port in the country has various quality certifications. In terms of productivity, parameters tend to change frequently. So we are not sure whether this would help."
J Krishnan, chairman of Madras Chamber of Commerce and Industry's (MCCI) logistics committee, said: "We wonder whether freight station operators would be open to audits. As competition increases such an rating will help in better marketing of products."

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